UACN records highest half-year revenue in 8 years

The United Africa Company of Nigeria has posted its highest half-year revenue in eight years, according to findings by BusinessDay.

Data sourced from the firm’s latest financial report showed UACN grew its revenue to N52 billion in half-year 2022 from N46.5 billion in half-year 2021.

According to CSL Research, the escalating inflation and subdued output growth which is ravaging many businesses in the country did not leave UACN behind as its recently released unaudited H1 2022 results showed elevated cost pressures.

Commenting on the results, Fola Aiyesimoju, group managing director stated, “our results for the first half of the year were significantly impacted by underperformance in our animal feeds and edible oils segment where we took significant leverage to fund inventory purchases in anticipation of meaningful volume growth.”

The consumer goods company saw its cost of sales up 13 percent to N43.1 billion in half-year 2022 from N38.2 billion in half-year 2021.

“The growth in UAC cost of Sales grew faster than revenue growth which pressured its year-on-year growth. The company’s year-on-year revenue growth was broad-based across its segments, supported by price increases on its products in a bid to pass on some of the increased raw material costs to consumers,” the CSL Research report noted.

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UAC recorded a loss of N716 million in half-year 2022, as against a profit of N762.6 in six months ended 2021.

Also, net finance costs showed a loss of N1.5 billion in June 2022 from the loss of N101.6 billion in the corresponding period of last year.

“Challenging market conditions resulted in margin compression in the sector, excess inventory, and profitability eroded by finance costs. We have taken steps to address this including cost management, aggressive inventory reduction, and initiatives to lower finance costs,” Aiyesimoju added.

Dividend income dipped 37 percent to N8.3 million in half-year 2022 from N13.16 million in half-year 2021.

Administrative expenses rose to N4.2 billion, 10 percent from N3.8 billion in the comparable period.

Marketing, advertising & communication jumped a huge 142 percent to N809.7 million from N334.1 million in the period under review.

Selling and distribution expenses rose to N3.7 billion in June 2022, 23 percent from N3 billion in the same period of the previous year.

Net cash flows used in operating activities recorded -N2.17 billion in June 2022 from -N14 billion in June 2021.

Net cash flows used in investing activities recorded a negative flow year on year to -N1.94 billion from -N599.2 million.

Net cash flows generated from financing activities dropped 9 percent to N5.8 billion from N6.4 billion.

Cash & cash equivalents at the end of the period dropped 18 percent to N13.2 billion from N16.1 billion.

The United Africa Company of Nigeria is a Nigerian publicly listed company based in Lagos. Its areas of operation include manufacturing, services, logistics and warehousing, and agricultural and real estate.